A senior resources bureaucrat has told a corruption inquiry he found it "extraordinary" that a small mining company was offering millions of dollars in financial contributions to NSW on bids for coal exploration licences in the Bylong Valley.

Kevin Fennell, who in 2008 was a probity auditor at the Department of Primary Industries, told the Independent Commission Against Corruption (ICAC) on Monday he was surprised how much Monaro Mining was pledging in additional financial contributions to the state on its bids for mining licences in the coal-rich area.

The ICAC has previously been told Monaro, a uranium miner with no experience in coal mining, applied for nine licences in the Bylong Valley and offered $50 million in additional financial contributions.

Those contributions included $25 million if it was awarded the critical Mt Penny tenement.

Mr Fennell said he found it extraordinary that such a large amount of money was being offered by a small mining company.

"I thought it was quite extraordinary that they made these offers to the extent that they did," Mr Fennell said.

ICAC is investigating if decisions made by former mining minister Ian Macdonald about mining licences in the Bylong Valley area were designed to benefit political colleague Eddie Obeid, who owned property in the area.

The inquiry has been told the Obeids asked a man named Gardener Brook to find a company which could partner the Obeids in a mining venture and that Mr Brook chose Monaro Mining.

Monaro ultimately withdrew its bid for the Mt Penny tenement, with that licence going to runner up Cascade Coal after the tender process was reopened by Mr Macdonald.

The inquiry has been told Cascade subsequently paid $30 million to the Obeids.

There is no suggestion of wrongdoing on the part of Monaro, the inquiry has been told.